We will contribute to the prosperity of
Basic
Philosophy our customers, shareholders, employees, and society by leading the way increating joy, value, and an environment that can be sharedthrough business logistics based on a global perspective.

Code of
Conduct

NIKKON Holdings Co., Ltd. and its subsidiaries adhere to the NIKKON Holdings Group Basic Philosophy

and follow sound business practices to fulﬁll our corporate responsibilities to customers, shareholders,
and local communities, contributing to the development of society.

To this end, the Company and its subsidiaries have established the following NIKKON Holdings Group

Code of Conduct, which all employees collectively uphold.

1. We place the highest priority on safety and aim for zero accidents and zero occupational injuries.
2. We comply with laws and regulations, social rules, and internal rules, and conduct businessactivities with the aim of being a company trusted by society.

3. We proactively address environmental issues and aim to be a company that is friendly to theglobal environment.

4. We actively disclose information about the Company to shareholders, customers, and local
communities in an impartial manner.

5. We strive to properly manage and protect personal information and customer data.
6. We strive to contribute to society by providing services that beneﬁt society.
7. We engage in fair, transparent, and free competition, and aim to be a company that employees

Editorial policy

Companies covered by this report

The NIKKON Group has compiled this report to provide various internal and

NIKKON Holdings Co., Ltd., its 70 subsidiaries,

through which we contribute to national and local communities in which we

Total: 75 companies

external stakeholders with an understanding of the value creation process

operate. The report summarizes key points about our trajectory of growthand four aﬃliated companies

from our establishment to the present, what sets us apart from other com-

Period of this report

more detailed information is also available on our website.

Some information from outside of the above

panies, and our growth strategy for the future. In addition to this report,

Cautionary note regarding forward-looking statements

FY2022 (April 1, 2022 – March 31, 2023)
period is included in the report.

This report contains forecasts and forward-looking statements regarding

Referenced guidelines

These statements are based on the information available at the time this

(IIRC, now part of IFRS Foundation) “International

NIKKON Holdings Co., Ltd.’s future plans, strategies, and performance.

The International Integrated Reporting Council’s

report was prepared. They involve many risks and uncertainties, including

Integrated Reporting Framework”

those related to economic conditions, exchange rates, tax and other regu-

latory systems. For this reason, actual results may diﬀer from our forecasts.

The Japan Ministry of Economy, Trade and Industry’s Guidance for Collaborative Value Creationand their families can be proud of.

8. We stand ﬁrm against antisocial forces and groups that threaten social order and safety.
9. Should a situation arise that violates the spirit of this Code, we will take swift and strict action toresolve the problem and prevent its recurrence.

CONTENTSSECTION 1

NIKKON at a Glance
1 NIKKON’s Philosophy

2 Value Creation Journey and Current Status
4 Value Creation Process

SECTION 2

NIKKON’s Growth Strategy
6 Message from the President
New Medium-Term Business Plan
10 (13th Medium-Term Business Plan)
12 Growth Strategy
14 Message from the CFO

SECTION 3

SECTION 4

Foundations for Growth
System for Promoting
16 Sustainability Management
17 Material Issues

18 Improvement of Safety and Quality
20 Promotion of Diversity

Data
22 Action on Climate Change

24 Strengthening Compliance
26 Corporate Governance
28 Directors and Oﬃcers

Financial and
30 Non-ﬁnancial Highlights
32 Group Companies
33 Company Proﬁle andStock Information

Integrated Report 2023

1

SECTION 1 NIKKON at a Glance

Value Creation Journey and Current Status

Since our establishment in 1953, the NIKKON Group has evolved to meet the needs of our
We will continue to create new value together with our customers and society while(billion yen)
220.0

promoting sustainability management, including environmental action.

200.0

2015/10

Our Value Creation JourneyTransition to holdings
company structure

Company name changed to NIKKON Holdings Co., Ltd.

Consolidated Net Sales of NIPPON KONPO UNYU SOKO CO., LTD.
NIPPON KONPO UNYU SOKO CO., LTD.
Other Group companies
Initial car carrier trailer

Current car carrier trailer

Vehicle with an underfloor engine modified into adouble-decker, a first in Japan (“Mammoth” loaded with
28 motorcycles on two floors)

Founder: Tsuneo Kuroiwa

1988/5

1994/3

1994/11Full-scale launchof operations

Establishment ofChinese subsidiary

Establishment ofThai subsidiary

v
pro
hile
w
g
win
Gro

1987/12
Establishment of US subsidiary

1957

ice
erv
s
g
idin

at
s th

r
ou
fy
s
i
sat

ed
mitt
Com

Introduction of double-decker
vehicles (Mammoth); launchof special vehicle development

to

c

er
tom
s
u

bus
both

s
ines

ds
ee
n
s’

sib
fea

150.0

env
nd
a
y
ilit

nt
me
n
o
r
i

100.0

50.0

Current double-decker vehicle (carrying race cars, etc.)

1954

1960

1970

1980

1990

9.2%

Approx.

Our operating profit ratio
is one of the highest
in the industry due
to our thorough costmanagement.

Number of domestic sales offices

Overseas affiliates

288 offices / 9countries

We have our own employees, vehicles, and warehouses which we operate in Japan and overseas.

While expanding globally, we have establisheda business foundation centered on the domestic
market through strong ties with blue chip clients
across Japan.

Approx.
2

85%

Integrated Report 2023

since founding

Over 20.0 billion yen
in growth investments

We generate a stable cash flow and continue to invest more than
20.0 billion yen annually in growth.

2010

Consolidated Financial Highlights
Net sales (billion yen)
197.7

199.5

Operating profit
182.5

198.2

212.1

Double trailer trucks

769 104(billion yen)

20.0
10.1

2019/032020/032021/032022/032023/03

Profit attributable to owners of parent (billion yen)
Car carrier trailers

2020

14.8

16.7

14.5

14.7

2019/03

20.9
10.5

2020/0318.2
10.0

2021/0319.5
9.8

2022/03

19.6

9.2

2023/03

ROE (%)

15.9

8.8
8.0
7.3

/

(577 in Japan, 192 overseas)
Number of car carrier trailers for transporting cars / 21m and 23m
double-trailer trucks introduced in 2014

Operating profit ratio (%)

2019/032020/032021/032022/032023/03

2019/032020/032021/036.9

2022/03

7.1

Data

Domestic sales ratio

70 years

Our main client, an automobile manufacturer,
has been our business partner for 70 years
since the company was founded. Our
relationship dates back to the chaotic postwar
period when motorcycles were wrapped instraw and transported in bicycle-drawn carts.

2000

23m full trailer

Foundations for Growth

The NIKKON Group in Numbers (Group characteristics developed over our history)
Operating profit ratio

al

ss
line
d
n
frie
NIKKON’s Growth Strategy

1953/8Founding and establishment of
NIPPON KONPO UNPAN CO., LTD.

NIKKON at a Glancecustomers and the times by developing a variety of special vehicles and providing services.

2023/03

Integrated Report 2023

3

SECTION 1 NIKKON at a Glance

Value Creation Process

Backed by a solid customer base, the NIKKON Group plays a role in developing the Japanese economy
NIKKON at a Glance

as a pioneer in integrated logistics centered on packaging, transportation, and warehousing.

We provide a one-stop service for all logistics-related needs: from auto parts testing to automotive

maintenance, import/export customs clearance, real estate, insurance agency, and consulting services.

Input (Management Resources)

in an agile manner,

we own many parts ofour facilities, enabling us

Number of employees

20,243to respond ﬂexibly

to our customers’ needs.

Warehouse area

Finances

OutputSelf Suﬃciency

Our economic value

JIMAE
SHUGI

Japan:

Group-owned
warehouses

2,500,000m

Equity ratio

63.4%
A

Long-term credit rating

Contract manufacturing

2

Modal shift

Forwarding
Customs clearance

Automotive maintenanceConsolidated
net sales
Operating proﬁt
Operating proﬁt
ratio

Consolidated net sales

212.071 billion yen

Operating proﬁt

19.580 billion yen

Operating proﬁt ratio

7.1%

ROE
MovingOﬃce relocation

9.2%

CDP score

MSCI ratingC

CDP score
MSCI rating

BBB(Year ended March 31, 2023)

What sets us apart

Vendormanagedinventory

Packaging materials
Petroleum sales

Providing one-stop logistics services●●

We are a comprehensive logistics provider that can oﬀer
our customers a one-stop shop for all logistics-related
services, including packaging, transportation, warehousing,customs clearance, testing, vehicle maintenance,
factory/oﬃce relocation (equipment installation),
consulting, insurance, real estate, and systems.

Collection,transportation, andprocessing ofindustrial waste

Strong capabilities in the ﬁeld
●

●

●

●

●

4

TENOUCHI
KANRI

Providing one-stop

including assembly

customers’ logistics

just-in-time delivery

services for all our●

Installation andtransportation of machineryand equipment

Testingneeds.

We constitute a part

Electric power salesof the supply chain,of parts in the

manufacturing

We own our own vehicles and warehouses, eliminating
issues such as wait times and the need for drivers to spendlong hours loading and unloading.

Safe transport, quality control

Providing new value in response to societal changes

To Employees●

processes andWarehousing●

Employee health and happiness

Fulﬁlling workplaces where diverse human resources
can contribute actively in various ways
Human resource development which utilizes thecharacteristics and strengths of each employee

industry.

Real estate

To Society●

Temporary staﬃng
Outsourcing●●

We have special/dedicated vehicles and warehousing facilities
to fulﬁll our customers’ needs according to their products.
We own our own facilities and strive to recover swiftly andﬂexibly in the event of problems such as bad weather.

●

Insurance agency

Working together with local communities in Japan,
for production areas to consumption areas, so as to
not interrupt the ﬂow of the supply chain

Contributing to circular logistics and carbon neutrality
Creating diverse jobs in Japan and nine overseas
countries

Consulting

Information systems

Design and analysis
Vehicle testing

Data

●

Hands-onManagement

To Customers

Transportation

We accept personnel from a variety of work backgrounds,
including automotive manufacturers, general trading
companies, megabanks, and the Japan Self-Defense Forces,
to augment Group management.

Self-Suﬃciency and Hands-on Management●

Service,
Selling●

A culture of “try to do everything yourself, rather thanleaving it to others” permeates the company, and ourbusiness strategies and initiatives are backed by diverse
ideas and experiences.

We respond swiftly and ﬂexibly to our customers according tocircumstances by thoroughly practicing a ﬁeld-oriented approachthat leaves a great deal of authority to sales oﬃce leaders.

One-Stop
Cross

Value we provide

Foundations for Growth

We deliver Japanese quality overseas through our global
network.

Packaging

By carefully maintaining and using fully depreciated ﬁxed
assets, we are able to achieve a higher cost eﬃciency thanleasing.

Integrated Report 2023

NIKKON’s Growth Strategy

45 companies, 288 sales oﬃces
Overseas: 29 companies in 9 countries
Business vehicles
4,549
NetworkModelhigh-quality services

Capital invested in our businesses
Human resources

Business

To provide a full range of

Integrated Report 2023

5

SECTION 2 NIKKON’s Growth Strategy

NIKKON at a Glance

Message from the President[Value we provide and our vision]

Our value lies in how we areappreciated by our customers
Since our founding, we have engaged in businessactivities with the aim of contributing to the nation,
especially to local communities, through logistics
services. The logistics industry is a service industry,
which means that we perform work on behalf of ourcustomers. In other words, we provide time. Logistics
quality, i.e., faster and more reliable delivery, is ouradded value.
On top of that, we aim to be appreciated by ourcustomers. This means that providing beneﬁts toevaluates us; metrics such as sales volume or how wefare against competitors are irrelevant. Expanding
our sales is only a means to an end. Ultimately, wemust follow our own path in our own unique ﬁeld.

[Our businesses and strengths]

Increasing customer satisfaction
through “self-suﬃciency andhands-on management”
Warehousing, packaging, and other such operations
account for half of our sales. We also do distribution processing, contract manufacturing, export
packaging, and forwarding; logistics is just one of ourcustomer services. Logistics is not all we do. What
sets us apart from other companies is that we do
whatever we can on behalf of our customers. Prologistics, one-stop service.

6

Integrated Report 2023

Masakatsu Kuroiwa

Our purpose is to do what only we can do. Part ofthis involves things like conducting test projects that
other companies will not attempt and owning many
special vehicles. If a customer consults with us, wewill oﬀer a variety of services and proposals. This synergy has resulted in increased customer satisfaction.
We say that we are “self-suﬃcient,” but self-suﬃciency is merely the means, while “hands-on management” is our actual goal. By working independently,
we are able to see both good and bad information,and understand where the problems are so that we
can take countermeasures. It is not about owning
or not owning assets, but about what is best for thecustomer.

[Market conditions]

Staying ahead of changes
in the world
The automotive industry, our core sector, is undergoing a once-in-a-century transformation as it shifts
away from fossil fuels. Our business model will haveto change due to the development of technologies
such as EVs and hydrogen, the issue of their cost, as
well as many social issues. We believe that continuing
to do new things is a way of adapting to these changes. In our 70-year history, we initially transported
freight in bicycle-drawn carts, then in three-wheelers,
and then as trucks became larger and larger, we developed double-decker trucks. I believe that keeping
ahead of the times means thinking in-depth about
what is troubling the world and anticipating whattroubles the world will have to deal with in the future.
The labor shortage is an unending issue for ourcompany. We have consistently been short of people
since Japan’s period of high economic growth after
WWII. For this reason, we have been working on automation and labor-saving measures since long ago.
Looking to the future, the transportation industry

thinking about what the value of our company will bein such an era.

[For sustainable growth]

Investing in human capital is
the key to growth

will be transformed as we move into an age of auto-

The key to further growth at our company is improv-

mated driving and AI, and our value to society will

ing the quality of our people. The only way to do thischange. If humans no longer work and all tasks areis employee education. We have always placed an

performed by robots, there will be no appreciationemphasis on education since our founding. Manyof labor, no need to react. Instead, the work will bethings our employees do that are taken for grant-easy and there will be no more “dirty, dangerous, anded here, such as truck dispatching, independent

demanding” workplaces. A kind of social revolution

accounting at each sales oﬃce, and cost manage-

will occur. I want to move ahead while constantly

ment, are not prevalent among employees at other

Integrated Report 2023

Data

viding time is the essence of what we do. Integrated

ized functions such as moving, IT, and consulting.

Foundations for Growth

our customers is everything. It is the customer who

The Group performs a variety of highly special-

President andRepresentative Director

NIKKON’s Growth Strategy

We will move forward together with
the Group and its employees, aiming to
be a “company that is useful to the world.”

7

SECTION 2 NIKKON’s Growth Strategy

but doing eight-hour job in ten hours is not proﬁtable at all. We need to teach our employees and letthem think about what they can do to get the samejob done in six hours.
M&A is another means of growth. In the past, pri-will also boost motivation. We instill within the com-

our shipper. Sometimes there are companies that are

mission. We have also been reducing CO2 emissions

pany that the value of our existence is to contributeunsure about the criteria used to choose a carrier.

for many years by increasing load capacity throughto local communities, and that we will be appreciated

The 12th Medium-Term Business Plan was a

the use of double trailer trucks and other vehicles. I

for our contributions. I think we are extremely fortu-

three-year plan that ultimately took four years due

believe that the value of our company’s existence isnate to be able to make money from being appreciat-

to the COVID-19 pandemic, but logistics kept moving

to contribute to society by giving due consideration

ed by our customers.

during this period, and the trend was steady growth.

to safety and environmental conservation.

[Aiming to improve corporate value]

For the 13th Medium-Term Business Plan, we

As for safety, we have our own specialized de-want to do something diﬀerent from what we havepartment for it, but beyond that, each and every one

been doing until now. There will be no naturalof us must be safety-conscious. We provide thoroughincrease if we keep doing what we have done in thesafety training from the time each new employee

past, so we will do new things in order to increasejoins the company, and continue awareness-raising

People ask how we can achieve a price-to-book ratio

sales and proﬁts.

activities and education thereafter. The Group also

(PBR) of 1, but it just so happens that the share priceholds a safe driving competition every year.

is not keeping up with the value of the company.

In our existing operations, each Group company
has a diﬀerent area of expertise, and dependingon the customer, there are services that we do not
yet oﬀer, as well as geographically complementaryareas. There is plenty of potential to increase synergy
by doing all kinds of cross selling as a one-stop
service.
Our new initiatives include circular logistics, the[Talent strategy]

Employees are the source of allvalue createdSeeing risks as opportunities,
and taking a steady growth path

They have it backwards. Running the company in aself-suﬃcient manner means that we have our own
equipment, which inevitably increases our equity.
That said, I have no intention of lowering this target.
I do not think that corporate value is determined

Although most of our employees are men, we dosolely by the share price or PBR, but if that were thesole criterion for judging corporate value, I would

to hiring and advancement. People often talk about

consider various measures to improve the shareand overseas businesses. In circular logistics, we will

women’s participation and advancement, yet we

price, such as share buybacks. I simply do not thinkleverage our strength in automotive logistics to pio-

have many truck drivers and forklift operators whothat raising the share price is the right purpose forneer resource recycling solutions for a recycling-ori-

are women. While others make a fuss about “women

buying back shares.

ented society, build a logistics network for reuse andthis, women that,” as a company, we operate in a

Sustainable growth is like a bicycle: you have torecycling, and provide support for everything fromgender-neutral manner and have never said any-

pedal it or it will fall over, so you just keep pedaling

procurement to sales, collection, and recycling. As

thing about women not being allowed here. Since weas hard as you can. That is also what makes it fun.

for food, there are many yet-untapped areas besides

are short on people to begin with, women are more

But we must always reassess whether what we are

the existing areas of drinking water, snacks, and rice.

than welcome to join us, and we accept all who comedoing is contributing to the world. If expansion itself

looking for.

The number of food product factories in Japan is

to us. This is because people are the basis of our

becomes our objective, we are doing something[Recap of the previous Medium-Term Plan

expected to increase even as the population declines,

self-suﬃciency policy. Since our workers are our own

wrong. I am one of our shareholders, and all thecreating opportunities for expansion in refrigerated

employees, we have the ability to manage them in aemployees are also shareholders, so the company

and frozen products, as well as in temperature-con-hands-on manner and train them to a high standard.

and its employees share the same fate. Companies

trolled warehouses. Overseas businesses, mainly inThat said, there are busy and slow periods, and we

whose shares you hold over the long term are goodthe United States and Asia, account for about 15%

must also seek outside help to prepare to handle

companies. Likewise, companies where employees

of our total sales. We would like to broaden ourthese peaks.

work for a long time are good, too. We manage themunicipality in Japan, and there were hearings at
the prefectural level that prevented companies fromentering if local transportation companies objected.
So, we had no choice but to acquire local companies.
Nowadays, M&A is more about buying time thanlicensing issues. It takes ﬁve or even ten years to
get oﬀ the ground when starting from scratch, butbuying an existing company can shorten that timeby three or four years. This is the kind of M&A we are

and overview of the new Medium-Term Plan]

Promoting the “deepening ofexisting businesses” and “development of new businesses”
Although we saw record proﬁts during the ﬁscal
year ended March 31, 2023, upon reﬂection, there
are many things we should have done diﬀerently
at the time. In a project that we ended up losing,of price, ESG-based evaluation, and other factors.
Our proposals will be compared with those of ourIntegrated Report 2023

chains and expand local businesses.

[ESG-based management]

Capturing market conﬁdence
through ESG-based management
We have always been highly conscious of our con-

Personnel transfers are determined by commu-

company to ensure that it can continue to contributenicating company policy while respecting the wishes

to society over the long term, so if you are a share-of employees. I also ﬁrmly believe that communica-

holder who agrees with that, we welcome you. I wanttion must be a two-way street, not a one-way street.

the company to be appreciative of all the stakehold-

Therefore, listening is important. The best way toers around it, and at the same time, I want it to be a

motivate employees is to make the work fun andcompany that is appreciated by all of them.

Data

we misjudged what the customer valued in terms

network of bases to support our customers’ supply

Foundations for Growth

not make gender-based distinctions when it comes

food sector (out of “food, clothing, and shelter”),

vate logistics companies had to be approved by each8

everything about money. Having a sense of purpose

management is our company’s essential role and

NIKKON’s Growth Strategy

Some people are under the illusion that working
more overtime means they are making more money,

tribution to society, and I believe that sustainability

shipper can choose their carrier, we can also choose

NIKKON at a Glancecompanies.

competitors, but we must not forget that while thecheerful, and if doing that makes money, even better.
However, we cannot be cheerful all the time, nor is

Integrated Report 2023

9

SECTION 2 NIKKON’s Growth Strategy

Review of the 12th Medium-Term Business Plan

Medium-Term Business Plan Financial Targets

The previous Medium-Term Business Plan was set back almost a year by factors such as the market slump induced by the COVID-19 pandemic and the slowdown in freight demand

Our plan for net sales is to continue stable growth throughto the situation in Ukraine and the sharp depreciation of the yen, as well as higher labor costs and other price hikes. To accommodate the future business plans of our major cus-

ment, aiming for a CAGR of 9.7%, or 280.0 billion yen.

due to the shortage of parts supply, including semiconductors. Furthermore, during the ﬁscal year ended March 31, 2023, our proﬁt ratio fell as a result of higher fuel costs due
tomers, we have made preparations for the post-pandemic market recovery by making 78.8 billion yen incapital investments over three years and establishing

Net sales

In addition to expanding our business re-Operatingprofit ratio

199.5

total ﬂoor space of 245,000 m2 across the Group.

sources, our eﬀorts to develop new customers

10.5%

have enabled us to gradually recover sales and

215.0

200.0

230.0

182.5
10.0%

10.0%

10.0%

Given the uncertainty of future cost conditions, such

198.2

212.1

dressing social issues, we intend to aggressively reduce

Net sales

achieve a proﬁt ratio of 10.0%.

Operatingprofit ratio

In addition, we aim to achieve a target return on

10.0%

9.8%

proﬁt during the period of the Medium-Term Busi-

9.2%

aﬀected by the time lag in passing on higher
fuel costs to customers, as well as a mismatch

Operatingprofitbetween the extreme ﬂuctuations in our major

20.9

shippers’ production plans and our human re-sources, which resulted in higher costs and lower

FY2020/3

proﬁt ratio. Now that production has stabilized,

20.0

21.5

FY2021/3

FY2022/3

-

-

ROE

however, these issues are being resolved.

7.3%
Results

23.0

18.2

19.5

19.6

FY2023/3

FY2021/3

FY2022/3

FY2023/3

8.0%

7.3%

6.9%

7.1%

Initial plan

Results

Streamlining and review of existing businesses/ Improvement of proﬁtability

Enhancement of corporate value through ESG-oriented management/ Continuation of eﬀorts to remain a company needed by society

Establishment of growth drivers/ Expansion of businesses while simultaneously creating the next core businesses

Establishment of human resource foundations/ Development and securing of next-generation human resources to ensure sustainable growth

280.0 billion yen

Operating proﬁt

28.0 billion yen

Operating proﬁt ratio

10.0%

ROE

8.00%

Business Efficiency

●
●
●

●

Business model transformation
Network expansion

Real estate business
M&A

Investments in warehouses,
vehicles, and equipment● Digital investments● Investments in quality
improvements●

Sustainability●Traﬃc safety /Zero occupational accidents● Human resource development /Capacity building● Environmental investments●●

Capital strategy /Shareholder returns
Cash ﬂow management

Integrated Report 2023

22.0

24.0

28.0

FY2021/3

FY2022/3

FY2023/3

FY2024/3

FY2025/3

FY2026/3

6.9%

7.1%

-

-

8.0%

Results

Medium-Term Business Plan

FY2022

FY2025

FY2030FY2050

‐

-3%

-30%

-100%

160,000

155,200

112,000

0

FY2022

FY202524%

30%

In order to achieve carbon neutrality by 2050, we have set anemissions reduction target of 3%

below the FY2022 level in our next
Medium-Term Business Plan. We
will continue to challenge our-selves to further reduce emissions,

CO2 progress(t-CO2)230,000●

210,000●●

and have set a target of -30% forPlan

FY2030, when various technological

Modal shiftdevelopments—including the shiftTwo-car coupling and full trailer

to heavy-duty electric trucks—are

Fuel-eﬃciency and eco-driving

expected to take place. As for wom-

Energy saving and eco-friendly
products●●

170,000●

Introduction of EV/FCV trucks
Purchasing of green power
Use of carbon credits●●

130,000●

110,000●2021

women to management positions by

Solar panels for in-house use: Sequential setup
and introduction

providing training and motivation,

as well as creating infrastructure andComplete abolition of mercury lamps and shift
to LEDs
2024

2025

2026

2027

who are women at 30%. First, we will

ly lay the groundwork for appointing

Trial introduction of hybrid heavy trucks

2023

percentage of all Group employees

graduates hired. Then we will steadi-

Passenger cars: Introduction of 120 EVs

2022

en’s advancement, we have set theincrease the number of new female

150,000

90,000

10

19.6

7.3%

Improving labor productivity
Cost reductions

19.5

2028

an environment in which women can
2029

2030

feel comfortable working.

Integrated Report 2023

11

Data

●

Cross selling

Growth Investments

10.0%

18.2

ROE

Percentage of all employees that are women

190,000

Establishment of growth drivers

9.6%

13th Medium-Term Business Plan (ESG-based KPIs)●

Growth Strategy

9.6%

Foundations for Growth“Contribute through our business activities to the realization and sustainable growthof a prosperous society that enables people to feel truly happy”

Customer-oriented

OperatingprofitNet sales

CO2 emissions (t)Challenge 13

9.2%

250.0

“self-suﬃciency and hands-on management.”

CO2 emissions reduction targets

Framework of the 13th Medium-Term Business Plan

9.8%

and capital policy consistent with our basic strategy ofFY2026/3

On the other hand, operating proﬁt was

●

10.0%

equity (ROE) of 8.0% or higher, based on a proﬁt plan

ness Plan, despite the impact of the pandemic.

Circulation / Food, Clothing,and Shelter / Overseas

182.5

costs and pass on costs to customers as necessary to

212.1

198.2

230.0

280.0

NIKKON’s Growth Strategy

six new sales oﬃces and 22 new warehouses with a

Net sales (billion yen) ／ Operating profit (billion yen)

new customer development and constant capital invest-

as rising fuel and labor costs, as well as the cost of ad-

Net sales (billion yen) ／ Operating profit (billion yen)

NIKKON at a Glance

New Medium-Term Business Plan (13th Medium-Term Business Plan)

SECTION 2 NIKKON’s Growth Strategy

NIKKON at a Glance

Growth Strategy

Development and Structure of Three Growth Drivers

Initiatives to Improve Eﬃciency

We will establish a new structure in the holdings business departments and promote the expansion of growth drivers.

[Labor saving and automation initiatives][Systemization initiatives (building a digital platform)]

With regard to labor saving and automation, in the warehousing busi-

With regard to systems-related initiatives, we will build aconveyors, warehouse robotics, mobile racks, and other equipment,

optimized platform to have our own in-house business manage-

Circulation businesses

Businesses related to food, clothing, and shelter

Overseas businesses– Pursue logistics more closely related to daily life –– Realize circulation businesses –– Expand overseas businesses –Participate in the three-temperature-zone
logistics business● Build a sensitive logistics operation system● Expand into the Kanto, Chubu, and Kansai
regions●●●

Develop local businesses overseas
Enter new overseas business areas

while working to ensure worker safety and reduce workloads,

resulting in more eﬃcient use of warehouse space. We will also

we aim to increase sales by

45.0 billion yen.

system, WMS, and began using it. In the 13th Medium-Term

vehicles for the future. In the transportation business, we will

Business Plan, we plan to develop a transportation and delivery

introduce and expand our ﬂeet of double trailer trucks, which can

23.2 billion yen+45.0

13.4 billion yen

billion yen

8.5 billion yen
FY2024/3

FY2025/3

We announced that we will increase our dividend payout ra-

tio from the previous “around 30%” to “around 40%,” starting

Sales Plan

with the dividend for FY2022. We plan to maintain this policy
for the time being.

Expand Existing Businesses

management system, TMS, and a data analysis system, LMS.

Shareholder Return (Dividend Payout Ratio/Share Buybacks)●

FY2026/3

ment system. During the period of the previous Medium-TermBusiness Plan, we developed a new inventory management

consider introducing autonomous forklifts and automated guided

reduce crew numbers by 50% compared to regular heavy-duty trucks.

With these three growth drivers,

proprietary development environment and self-develop a totally●●

In addition, on May 31, 2022, we retired 2,500,000 treasury

shares. We intend to retire any unnecessary treasury shares
while looking to utilize newly acquired treasury shares forstock options, stock-based remuneration, and M&A.

We announced our policy to continuously buy back shares in

the amount of 10.0 billion yen over three years starting in the

1. Customer-Oriented Marketing

ﬁscal year ended March 31, 2023. By October 13, 2022, we had

ble capital investments with an annual target of 23.0 billion yen, while monitoring cash ﬂow. We will operate with suﬃcient ﬁnancial

Total dividends (billion yen)reserves to ﬂexibly invest in ESG measures, such as human resources and digital transformation (DX), as well as in future uncertain-bought back 1,352,000 shares amounting to 2,999 million yen.

Share buybacks (billion yen)

Total payout ratio(%)

Foundations for Growth

We will provide high value-added services in line with the long-term growth strategies of our major customers. We plan to make sta-

Dividend payout ratio(%)

3.0

ties, in response to societal needs and management conditions.

Transportation (billion yen)

Warehousing (billion yen)

Packaging (billion yen)

Testing (billion yen)

Other (billion yen)

4.0

33.1
9.2
0.6
2.7

13.1

0.8 0.9
3.2

12.1

FY2016/3

6.3
FY2017/3

7.0

2.1
2.9

15.2

1.8
1.0
1.6

4.0

11.0

5.0
1.5
2.8

2.5
1.2
1.0

10.6

13.8

6.7

5.2

4.1

FY2021/3

FY2022/3

FY2023/3

4.5

4.4

FY2019/3

FY2020/3

2. Cross Selling Strategies

6.4

3.1
0.8
1.9

2.0
2.2

FY2018/3

1.5

22.2

16.5

5.8

12.4

23.0

23.0

23.0

FY2024/3

FY2025/3

FY2026/3

3. Business Model Transformationon three axes: services, Group companies, and local commu-

real estate business; and M&A.

earth sales activities.

12

Integrated Report 2023

freight/N-Logi; circular logistics/3R: Recycle, Repair, Return;

5.0

0.2
4.1

4.4

3.6

4.5
51.0

0.0
4.4

38.7

33.8

59.1

-

-

-

40.2

40.0

40.0

40.0

FY2023/3

FY2024/3

FY2025/3

FY2026/3

4.5

34.6
30.3

30.2

31.3

30.1

30.2

30.1

30.2

30.3

29.9

30.3

30.7

FY2015/3

FY2016/3

FY2017/3

FY2018/3

FY2019/3

FY2020/3

FY2021/3

FY2022/3

Data

We will further accelerate our existing strategies: consolidated

nities, and steadily reinforce our sales base through down-to-

3.7

0.6

0.5

62.2
0.0

Leveraging the advantages of “self-suﬃciency and hands-on

management,” we will develop cross selling strategies based

3.1

28.3

7.3

6.3
7.6

28.3

25.9

23.2

NIKKON’s Growth Strategy

Expand into the recycling business, in which
we process the materials ourselves● Partner with recycling and emissions companies● Area of contribution to existing logistics lines●

ness, we will increase work eﬃciency by introducing vertical

Integrated Report 2023

13

SECTION 2 NIKKON’s Growth Strategy

Director andManaging Executive Oﬃcer

Yasunori Matsuda[Investment areas and criteria]

Circular logistics, expanding the range offood products, and expanding overseas
businesses as our growth drivers
As for our market environment, adapting to the automotive

industry’s shift to electric vehicles (EVs) is an urgent issue, andin the ﬁrst half of last year. While we have been continuously
reducing cross-shareholdings, we have announced that wewill not divest shares in our strategic partner Honda MotorCo., Ltd. Excluding these, we hold shares in 15 companies,

mainly our customers. Our stance is to sell them when ourcustomers request us to do so, but the market valuation of allthese investments combined is not particularly large.

We will actively promote ESG-based investments that are

we are working to adapt to structural changes in the automo-

desired by society, such as investments in human capital and

the Group intends to focus its eﬀorts on the growth drivers inarrived on the market, we will focus on what we can do, such

was in the 8% range prior to the COVID-19 pandemic, but it

circular logistics, particularly batteries and other automotive

and installing solar panels for in-house use.

to bring this back up to its former level. Our basic strategy iscount for about 15% of total sales; and food as a component

income. However, since equity has grown considerably due toour ﬁnancing costs relatively low, and I believe our ﬁnancing

returning proﬁts to shareholders is also important, so we are[Approach to ﬁnancial strategy]

An optimal portfolio that considers both
debt and equity

tive industry, such as changes in parts suppliers. Meanwhile,
the Medium-Term Business Plan that started this past April:

CO2 reductions. Since heavy-duty electric trucks have not yet

as replacing light-duty trucks and passenger cars with EVs

fell to 7.1% in the ﬁscal year ended March 31, 2023. We intend

parts; expanding overseas businesses, which currently ac-

In our ﬁnancial strategy, our main source of ﬁnancing is basi-

to improve ROE by expanding the business and increasing netof “food, clothing, and shelter.” We have been involved in bev-

erages and rice in the past, but some areas remain untapped,

Continuing share buybacks and a 40% dividend payout ratio for the time being

have an “A” credit rating from R&I, we have been able to keep

the accumulation of past proﬁts, we need to utilize debt eﬀec-

and we believe it is important to strengthen our eﬀorts inWith a view to enhancing shareholder returns, we raised thetively and promote investment while watching the balance of

these areas. In order to expand in these new business areas,

dividend for the ﬁscal year ended March 31, 2022, from a pay-debt and equity. We also need to take a closer look at this in

M&A is one of the most eﬀective means of acquiring business

relation to cash ﬂow.

expertise.

out ratio of about 30% to about 40%, and we plan to maintainis so high. The answer is that in addition to our transportation

primary aim of expanding the scale of our business; rather,aging businesses, which have relatively high proﬁt ratios. We

is weak or augmenting our logistics functions. At the sameance sheet to some extent in our business model. Althoughfrom other companies. In the warehousing business, self-

not easy to ﬁnd acquisition targets that meet this criterion.

investment, in reality, with careful maintenance, our equip-

used, which is yet another source of proﬁt for the Group.

side initially, we are looking to raise the proﬁt ratio throughcost of shareholders’ equity or weighted average cost of

improving load eﬃciency, and other eﬃciency-related gains.

cally corporate bonds, but we also have bank loans. Since we

capacity is suﬃcient for the time being. At the same time,

managing our operations while striking a balance between
debt and equity.

By adopting a “self-suﬃcient” approach, the Group makes

capital investments in a planned and strategic manner. Since

capital investments depreciate over time following the initialment continues to be operational for quite a long time after
depreciation ends, making the total cost advantage greaterthan that of leasing. In addition, since we manage these as-

business, we are also engaged in the warehousing and pack-our focus has been on ﬁlling in regions where our network

also have a segment called “testing,” which is quite diﬀerent

time, since our target is an operating proﬁt ratio of 10%, it isowned warehouses account for about 60% of the total area

Even if the acquired company’s proﬁt ratio is on the lower

We have not previously disclosed ﬁgures such as thepost-acquisition synergies, such as increasing freight volume,

capital (WACC) to the public. In our businesses, while return[Contribution to the New Medium-Term Business Plan]

sets ourselves, we are able to use them eﬃciently in terms of

on invested capital (ROIC) is important, operating proﬁt is

industry-leading operating proﬁt ratio.

high percentage of warehouse operations and services, such

our asset eﬃciency, such as total asset turnover, tends to bewarehouses. The equity ratio is not a ﬁnancial target per se,

Business Plan is to look closely at the proﬁtability of ourworking to improve asset eﬃciency by liquidating accounts

capital and debt while monitoring shareholder expectations

lower returns than the cost of capital. We state that our in-both time and operations. I believe this is what has led to ouran equally important management indicator because of theContinuing to invest in growth that aligns
with customer needs

At the same time, however, because we are asset-heavy,

as product receiving and shipping and assembly work in ourOur basic approach to investments in the 13th Medium-Termlower than that of other companies. To address this, we are

but rather a means of achieving the optimal balance between

investments, as there is no point in making investments withreceivable.

and future interest rate conditions.

vestments will amount to 23.0 billion yen each year for a total[Management indicators]

one to be desirable. If our shares are undervalued, we are

reality, however, we are making investments according to theHence, a higher share price is better. The most importantvestments exceed the plan. We would like to be ﬂexible in thisWe target an operating proﬁt ratio of 10%
and ROE of 8%
Business Plan targets an operating proﬁt ratio of 10% and

ROE of 8%, in addition to net sales of 280.0 billion yen. ROE

14

Integrated Report 2023

starting in the ﬁscal year ended March 31, 2023, with a targetof 10.0 billion yen. By October 2022, we had bought back 3.0

billion yen of treasury shares, and our plan states that we willcontinue to buy back an additional 7.0 billion yen by the ﬁscal
year ending March 31, 2025. We anticipate using some of

the treasury shares repurchased from the market to provide
stock-based remuneration to directors, but we will basicallyretire any other unnecessary shares.

Going forward, we will aim to enhance our corporate

value while continuing to pursue a capital policy and ﬁnancial
strategy that satisﬁes our various stakeholders, including
shareholders and investors, as much as possible.

of 69.0 billion yen over three years, based on our cash ﬂow. In

more likely to become the target of a corporate takeover.

needs of our customers, so there may be cases where our in-thing is to raise our corporate value from the business side.

regard, and consider investments together with ﬁnancing.

of our capital policy, including shareholder returns, and weour balance sheet and began liquidating accounts receivable

Even so, I feel it is necessary to clearly articulate the direction

tinuously buy back our own shares over a three-year periodData

As for our management indicators, the 13th Medium-Term

As for PBR, we naturally do not consider a PBR less than

this policy for now. Likewise, we announced our policy to con-Foundations for Growth

many of our assets are self-owned, we make use of the bal-

We are often asked why the Group’s operating proﬁt ratio

That said, we have not previously pursued M&A with the[Shareholder return policy]

NIKKON’s Growth Strategy

Aiming to maintainour ﬁnancial health so as to beable to invest ﬂexibly in the faceof future uncertainties.

should consider this issue within the company.

NIKKON at a Glance

Message from the CFO

At the same time, we are conscious of slimming down

Integrated Report 2023

15

SECTION 3 Foundations for GrowthMaterial Issues

Basic Approach to Sustainability

Material Issue Identiﬁcation Process

The ESG Promotion Oﬃce created a list of social issues,
identiﬁed their relevance to the Group’s business activities
and stakeholders’ expectations, and ordered them by priority.

Society is undergoing rapid changes, as exemplified by environmental issues, the declining birthrate
and aging population, and human rights issues. In the midst of these changes, we at the NIKKONGroup are determined to contribute to national and local communities by squarely facing theissues at hand and creating new value with all stakeholders through our logistics business,thereby realizing a sustainable society and enhancing our corporate value.

Step 1. Identify social issues
Step 2. Materiality map

System for Promoting Sustainability Management
governance (ESG) criteria is one of management’s most important tasks. To achieve this, we have established a system
in which directors directly supervise ESG activities and quickly formulate policies and provide guidance, so as topromote highly eﬀective ESG activities. In July 2021, we established the ESG Promotion Oﬃce within NIKKON Holdings
to execute the Group’s ESG activities. The oﬃce conducts Group-wide, cross-sectional activities led by a working

group of members from eight core companies. In addition, the Sustainability Committee we established in October● We considered their relationships with the Group’s business activities and our stakeholders’ concerns.

● We evaluated the importance of the issues to the Group’s business activities andour stakeholders to create a materiality map.

● We evaluated and examined the issues internally based on experts’ opinions andidentiﬁed the material issues of the NIKKON Group.

[Step 2: Outline of the materiality map]

Level of importanceto our stakeholders

The NIKKON Group believes that enhancing systematic measures regarding its environmental, social, and● We made a list of social issues while referencing the SDGs and international reports and action frameworks.

Improvement of safety and quality ● Action on climate change●

Ecosystem conservation●

Strengthen governance

Information disclosure●●

Sustainable procurement●

Controlling and preventing air pollution●

Promotion of diversity

High value-added services●

Information security

Creating ties with local communities

●

●

●

Promotion of digitalization and digital transformation●

Developing high-level logistics human resources●●

Respect for human rights

2021 eﬀectively functions as an organization that oversees ESG activities and reports directly to the directors.

●●

Strengthen compliance

Creation of comfortable work environments

NIKKON’s Growth Strategy

Step 3. Identify material issues

NIKKON at a Glance

System for Promoting Sustainability Management

Level of importance to our business

The Sustainability Committee is chaired by a female independent outside director who, under the direction of the

President and Representative Director, oversees and provides guidance on the execution of all ESG-related matters,
including diversity and environmental action, from the perspective of shareholders and other stakeholders.

Nikkon Group's organizational framework for sustainability

Priority themesTraﬃc safety

Board of Directors

Improvement ofsafety andSustainability Committee

quality

Provide guidanceand supervise

Occupational safety
and health
Provision ofhigh-quality services

General Aﬀairs Department/ESG Promotion Oﬃce

diversity
Auto Technic Japan Co., Ltd.

NIPPON RIKUSO Co., Ltd.

CHUETSUTEC Co., Ltd.

MEIKON CO., LTD.

ITO-EXPRESS CO., LTD.

NIPPON UNYU CO., LTD.

NK PARTS INDUSTRIES, INC.

Other Group companies in Japan

Other Group companies outside Japan

Integrated Report 2023●●●

Providing education and training ontransportation safety
Improving the workplace environment
Strengthening heath and safety training
Early detection and prevention of diseases

ー

Improving safety and quality throughsmall-group activities

Creating comfortable infrastructure andwork environments● Fostering next-generation human resources● Promoting the active participation of women
by formulating career and education plans● Providing training to transform awareness● Revising the personnel system● Employing more people with disabilities

Realization ofdiverse workstyles●

Action on

climate change

Achieving carbon
neutrality●

Improving transportation eﬃciency
Promoting modal shift

Switching to renewable energy● Introducing environmentally friendly
equipment●

Increasing the compliance awareness ofGroup employees through education● Establishing a hotline and strengthening
the system for receiving reports● Fostering mutual trust through fair deals

Percentage of all employees that are
women: 30%● Fulﬁlling the legally mandated
percentage of employees withdisabilities at all applicable sales
oﬃces
●

●

CO2 emissions reduction target: -3%●

CO2 emissions (t):(Compared to FY2022: 160,000 t)

155,200 t●

Strengthening
compliance

16●

Related SDGs

Ensuring stakeholders’ trust

Data

NIPPON KONPO UNYU SOKO CO., LTD.

●

13th Medium-Term Business Plan
FY2025 targets●

Promotion of
ESG Working Group

Main initiatives

Foundations for GrowthMaterial Issues

NIKKON Holdings Co., Ltd.

[Execution of operations]

Priority Themes and Main Initiatives & Targets Based on Material IssuesーIntegrated Report 2023

17

SECTION 3 Foundations for GrowthMaterial Issues

Improvement of Safety and Quality
Safety & Quality Policies

The NIKKON Holdings Group
understands that safety is
the most important issue
in our business operations.
Based on this understanding,we make Group-wide eﬀorts
to ensure workplace safety,
prevent traﬃc accidents, andprovide high-quality services
in actual business operations. We ensure the safety
and healthy lifestyles of ouremployees (including theimplementation of infection
control measures), and engage in activities to earn the
conﬁdence of our customers
and society.

1. Understand that ensuring safety is asocial mission in the management of
the Group, ensure that all employees
understand its importance, and takeaction together.

Safety education through original videos

Our core operating company’s quality and safety department creates originalvideos using safety education illustrations and actual dashcam footage, and[ANS Committee Activities]
5. Improve employees’ driving skills
and other skills through driving skills
competitions to prevent accidents andcontribute to society in terms of safety.

2. Respect human life, place the highest
priority on safety, and ensure that every
employee has a sense of ownership andtakes the initiative in preventing accidents.

3. Comply with relevant laws, regulations, andother rules and act in accordance with theThree Actuals Principle (the actual place, theactual situation, and the actual thing).
4. Build a safe and secure businessenvironment through the proactive
management of occupational health atworkplaces and by striving to improve
the workplace environment and promote the good health of employees.

6. Ensure safety and maintain stable
quality through small group activities,
improvement activities, and otherinitiatives and introduce advanced
ideas and technologies to provide reliable, high-quality services to fulﬁll the
expectations of all stakeholders.

7. Encourage Group companies to share
information and technologies witheach other to improve safety andquality.

8. Establish strong disaster control measures
and BCP measures to prepare for major
natural disasters.

has built a system that allows the videos to be viewed online, which helps tobring safety education up to the same level at all sales oﬃces. In addition,

We have established the All
Nikkon Safety (ANS) Committee, consisting of 12 operatingcompanies in Japan, to shareadvanced knowledge and information on incidents and systemtechnologies with the aim ofincreasing safety awareness andpreventing traﬃc accidents. Ledby our core operating company
NIPPON KONPO UNYU SOKO
CO., LTD., the members meet
regularly to share informationon their eﬀorts to prevent traﬃc,
product, and work-related accidents and to improve the overalllevel of their eﬀorts.

All Nikkon Safety (ANS) Driving Skills Competition
We hold the ANS Driving Skills Competition, which is a high-level driving
skill and knowledge competition, to increase safety awareness and promote traﬃc accident prevention activities across the NIKKON HoldingsGroup. The competition is an opportunity to showcase the day-to-day

eﬀorts of each Group company and the professional skills of employees
who have worked hard to hone their abilities in the truck, forklift, andpassenger vehicle loading and unloading categories. At the same time, it is one of the most important activities for all members of the Group,

the participation of a total of 130 contestants, including the winners of preliminary competitions held with 320 contestants from across Japan, and10 contestants from overseas subsidiaries (China, India, Vietnam, and Thailand) who were able to participate for the ﬁrst time in four years.

development of automobiles and mobility) conducts a variety of safe driving

manager activities, including classroom lectures and distance learning, basedon the idea that driving, the company’s product, must never injure people orcause damage. As development of advanced driver-assistance systems (ADAS)
and autonomous driving (AD) enters the phase of test driving on public roads,
we are conducting our own tests to certify our drivers’ safe driving skills andknowledge of on-the-road driving based on clear criteria, in order to ensure
the safety of our employees and operations.

Initiatives to Prevent Accidents (Outside Japan)
We also conduct safety-related education outside of Japan, including new
driver training, safety lectures, and on-the-job training for driving andoperations; face-to-face training of new drivers under Japanese standards,

including face-to-face roll call and training using digital tachograph data; andlectures to improve understanding of truck performance and design taught byexternal lecturers. In addition, we have introduced various tools and systems
to prevent accidents, including stickers to alert truck drivers to maintain adistance from other vehicles, digital tachographs, dashcams, talking back-up

alarms, a system that prevents drowsy driving, a GPS monitoring system, andFoundations for Growth

whose highest priority is safety, to think about “safety and security.” The eighth competition held in FY2023 focused on safety technology and saw

Auto Technic Japan Co., Ltd. (a company that supports the research andsafety lights and rear lights on forklifts.

In the United States, we provide education on accident prevention

measures from an ergonomics perspective, and ﬁrst aid and AED training. We
have also introduced the Omnitracs ﬂeet management system (GPS,Diverse Education and Training Programs

NIKKON’s Growth Strategy

Safety & Quality Philosophy

NIKKON at a Glance

Initiatives to Prevent Accidents (Japan)

dashcams, a traﬃc sign recognition feature, and driving route optimization).

We provide a variety of crew member training (including training for somesubsidiaries and aﬃliates) at the core operating company’s Safe Driving
Training Centers (two locations in Saitama and Mie), including special

instructional training for beginner drivers at all oﬃces nationwide, training for

full-time drivers after ﬁve months of employment, training for drivers 60 years
and older, and 21 m full-trailer truck training.

Compliance with Statutory Speed Limits and Introduction of Advanced Safety Equipment
Compliance with Statutory Speed Limits

Introduction of Advanced Safety Equipment

Our core operating company has strictly complied with statutory speed

Our core operating company introduced digital tachographs

the results of AHK Circle activities. Each year, about 15 teams from Japan and overseas are

speed limiters is now mandatory in Japan, over 30 years ago it was com-

20 years ago (since 2004). We also implement advanced

holding the event on a global scale, we aim to energize these activities and enhance theas passenger cars. Because we complied with the speed limit even then,these small-group improvement activities with the aim of improving safety (Anzen ), quality

and white (the livery of NIPPON KONPO UNYU SOKO CO., LTD.). This is

AHK Group Convention

limits stipulated by the Road Traﬃc Act. Although the installation of

selected to participate through preliminary competitions held by each company. By

mon for commercial trucks to travel on expressways at the same speed

Group’s sense of unity and awareness of improvement activities. We will continue to holdpeople often joked that the trucks at the head of a traﬃc jam were red(Hinshitsu ), and eﬃciency and the environment (Koritsu + Kankyo
ankyo ).

how safety-conscious we are in our business operations.

18

Integrated Report 2023

and rear/side cameras on all of its commercial trucks about

safety measures in terms of hardware. We are upgrading ourdigital tachometers to next-generation models and adding

Data

The NIKKON Holdings Group holds the AHK Group Convention as a forum for showcasing

new features, such as real-time driver notifications about
speeding, lane drift, and swerving based on road surface

recognition, contributing to further safety improvements.

Integrated Report 2023

19

SECTION 3 Foundations for GrowthMaterial Issues

We are working to promptly fulﬁll thelegally mandated percentage of employees

In October 2022, two members of Auto Technic Japan Co., Ltd. participated in the
National Sports Festival for People with a Disability, Japan’s largest sports tournament
for people with disabilities, which is held to promote the participation of people withdisabilities in society, and each won a medal.

with disabilities at all sales oﬃces thatmeet the criteria of the Act to Facilitate the
1. Safety ﬁrst
Logistics is an essential function that underpins all the basic necessities of life: food, shelter, andclothing. Providing sustainable logistics services in a stable manner is our mission. “Safety,” whichis the foundation of logistics services, is the most important theme in our mission to society, andall Group companies place the highest priority on it.

2. Building next-generation logistics
We are also focusing our eﬀorts on the development of next-generation logistics and conveying
the importance of logistics to younger generations. Since 2021, we have held endowed lectures
on logistics management at Hitotsubashi University. Through these lectures and visits to our sales
oﬃces, we aim to help foster the next generation of human resources who will lead the developmentof the logistics industry and the future of logistics. We also second our employees to an external
logistics research institute to study the latest developments in logistics.

Employment of Persons with Disabilities, as well as the minimum percentage

scheduled to increase in the future. We will
create a comfortable work environmentthat enables all employees, including thosewith disabilities, to work enthusiasticallywithout any discrimination.

Top Partner Agreement with Cerezo Osaka Co., Ltd.

3. Strengthening eﬀorts for employees’ continuous growth
The NIKKON Group is committed to creating policies and environments that support growth, in which
everyone has access to programs that help them balance work and private life events, and in which theyreceive equal education, training, and evaluations that develop their abilities. We accept diverse humanresources regardless of gender and nationality and plan to create a sustainable system for developing
human resources from a concrete, medium- to long-term perspective by promoting the acquisition ofvarious national certiﬁcations in order to create an environment conducive to such diversity.

Female Empowerment and Related Initiatives

On February 4, 2022, NIKKON Holdings signed a top partner agreement with Cerezo Osaka Co.,
Ltd. We renewed this agreement in 2023.

We aim to enhance our social contribution activities by supporting the J.League club team,which will increase our visibility in Osaka and other areas in the Kansai region and strengthen

workforce recruitment. We will contribute to the creation of a sustainable society together withthe supporters of Cerezo Osaka and local communities.

physical strength, such as cargo handling work that involves heavy labor. These requirements have limited theContributing to Local Communities
Through Soccer

set a target of increasing the percentage of all employees that are women from 24% in FY2022 to 30% in FY2025, theAs part of our local contribution activities, we held a soccer

on developing female executives by creating a more friendly environment and infrastructure and formulating career

Stadium in Osaka City, as well as anotherpotential of the logistics industry. Rather than simply having women take on jobs traditionally handled by men, weThailand. By providing children, the next

In FY2022, we brought in advisors from the Ministry of Health, Labour and Welfare to promote women’s

to receive high-quality soccer instruction

participation and analyzed related issues. Since FY2023, we have been implementing initiatives aimed at achieving

used by professional soccer players, we

within the Group.

of playing sports and contribute to their

There are many operations in the transportation and warehouse logistics industries that conventionally demand
number of operations in which women can play an active role. However, in our 13th Medium-Term Business Plan, weclass for elementary school children at Yodoko Sakuraand education plans that encourage women’s active participation, which will enable them to see the appeal andclass overseas at Ayutthaya Stadium inwill create workplaces where women can leverage their abilities to play active roles safely.

generation of leaders, with the opportunity

participation and advancement at 10 Group companies in Japan, and they assessed the status of women’sfrom professional coaches at stadiums“Eruboshi (L-Star)” Certiﬁcation. We also encourage the active disclosure of information and sharing of initiatives

enable them to experience the fun and joy

Integrated Report 2023

sound physical and mental development.

Overseas Trainee Program

Endowed Lectures at Hitotsubashi University

We launched the trainee program in 2010 with the aim of expanding theoverseas businesses of the NIKKON Holdings Group. This year marked the12th year of the program. (The program was cancelled during the pandemic
in 2020 and 2021.) Ambitious young employees who have been selectedbased on a report and interview with the president are assigned to a Group
company outside of Japan, where they work in overseas operations for about
one year. In addition to helping trainees acquire operational expertise, thisprogram aims to develop human resources capable of becoming future
managers by equipping them with cross-cultural communication skills, a
broad perspective, and diverse values through real-life experience overseas.
So far, 44 men and eight women have participated in the program in the
United States, Thailand, Vietnam, and Indonesia. The average age of trainees
at the time of participating is 30.6 years old.

NIKKON Holdings Corporation has endowed lectures on logistics management at theFaculty of Commerce and Management, Hitotsubashi University. Through these lecturesand joint research with the university, we aim to help foster the next generation ofhuman resources who will lead the development of the logistics industry and the futureof logistics. In these lectures, we introduced trends in logistics that have been identiﬁed
through our research to date. We also discussed issues surrounding logistics based on

speciﬁc examples and explained (1) the current status and issues surrounding logistics

management, (2) recent debates in logistics management, with a focus on the relationshipbetween logistics management and digital transformation (DX) due to the recent

advancement of information and communication technologies (ICT), as well as the

response to environmental problems, and (3) speciﬁc issues and solutions related to thegovernment’s comprehensive logistics policy framework and future policies.

Integrated Report 2023

21

Data

20

Foundations for Growthﬁnal year of the plan. Going forward, we will increase the number of new graduate hires who are women and focus

NIKKON’s Growth Strategy

The NIKKON Group’s policies for humanresource development and improving theinternal environment, which includes ensuring
diversity, are centered on the establishment of
next-generation logistics. In December 2022,
we established the Human Resource (HR)Management Department under the directcontrol of the President, creating a structure
to manage human capital across the entire
Group. Japan’s logistics industry is facing the“2024 problem,” an expected shortage of truck
drivers once overtime hours are capped in
2024, and is in the process of transitioning
from the existing system to a new type of
logistics. To keep up with this transformation, we must invest in highly-skilled logistics
personnel. Against this backdrop, we haveestablished the following policies for humanresource development and improving theinternal environment, which includes ensuring
diversity in the NIKKON Group.

NIKKON at a Glance

Promotion of Diversity

Employment and Participationof People with Disabilities

SECTION 3 Foundations for GrowthMaterial Issues

Aiming to realize a decarbonized society, the NIKKON Holdings Group has long been helping to prevent global warming by supplying clean

renewable energy through the installation of solar power generation facilities at 15 Group locations in Japan. In addition, our core operating

NIKKON at a Glance

Action on Climate Change

Solar Power
company NIPPON KONPO UNYU SOKO CO., LTD. installed solar panels for in-house use at its Utsunomiya Sales Oﬃce in October 2015 and at

Environmental Philosophy

its Kikuyo Sales Oﬃce in March 2023 with the aim of reducing its CO2 emissions. These eﬀorts have reduced the amount of fossil fuel-derived
electricity used at each location. Furthermore, the Kashiwabara Sales
Oﬃce warehouse in Saitama, the Inzai Sales Oﬃce in Chiba, and the

1. Seek to achieve carbon neutrality by 2050 by consolidating the knowledge
and technology of the entire Group and working to reduce our environmental impact, thus fulﬁlling our social responsibility.
2. Abide by environment-related laws and regulations, and formulate andcontinuously promote voluntary improvement plans aimed at, for example, improved transportation eﬃciency, shifting to renewable energy, andthe use of environment-conscious facilities.
3. Contribute to national and local communities by cooperating with stakeholders toward the achievement of a sustainable, recycling-oriented society.
4. The Group will set quantitative targets and speciﬁc reduction measures toreduce CO2 emissions, and proactively disclose its eﬀorts to achieve thesetargets to stakeholders.

Modal Shift (JR)Our core operating company has been using container transport since 1967. In 1989, it developed

31-foot containers for the transport of motorcycles by rail and began rail transport between Fukuoka

and Tokyo. We have developed unique containers based on customer needs, such as a double-decker
container with a hydraulic upper deck and roof for easy loading and unloading of motorcycles, and a

Suzuka Center Sales Oﬃce in Mie plan to begin generating their own

electricity from solar panels for in-house use in October 2023. We areworking to introduce a wheeling service for in-house use, and in the
future we envision being able to use the surplus power generated

to provide electricity to the head oﬃce during the daytime. We willcontinue to promote similar initiatives whenever possible to lower the
consumption of fossil fuel-derived electricity across the Group andreduce our CO2 emissions.

Circular Logistics

Recovery Logistics

emissions from rail transportation are 1/10 those of truck transportation) while helping to address theAs part of our peripheral logistics services to customers,

only reduce our environmental impact and energy consumption, but also help us to realize “peo-consumers and sales companies. We are leveraging ourshortage of truck drivers by easing road congestion and reducing working hours. These eﬀorts notple-friendly” logistics that beneﬁts workers.

eﬀorts toward the realization of a recycling-oriented society,transportation eﬃciency and reduce environmental impact, for charter and consolidationtransport, as well as for transfer and long-haul transport that reduces driver workload. In June

2020, NIPPON KONPO UNYU SOKO CO., LTD. received the Logistics Environmental Conservation
Activity Award at the 21st Logistics Environment Awards in recognition of its modal shift during
the transport of rain gutters and sewer covers between Gunma and Saga prefectures. In thisinstance, 21-meter full-trailer trucks were transported by ferry, then used in the truck

transportation section to transport freight equivalent to two heavy-duty trucks with a single
driver, which reduced CO2 emissions and improved transportation eﬃciency.

Eco-driving
Eco-driving is an important mission for the transportation industry. At the NIKKON Holdings Group, we have been promoting fuel-eﬃcient andsafe driving since 2004 by introducing digital tachographs across the board, checking our operations, and conducting eco-driving seminars,
the distance between vehicles, the engine RPM, and using the idling stop system. We are also striving to achieve fuel-eﬃcient and safe

operations that are friendly to both people and the planet by building on actions we can take now, such as using environmentally-friendly

Production
logistics

Procurement
logistics

Manufacturers

Sales
logistics

Parts manufacturers

Supply chain
Sales companies

Procurement
logistics

Used products

Circular chain

Raw materials
manufacturers

in the social infrastructure of logistics, and as part of ourSales companies

Recyclinglogistics

we will expand our operations into the areas of “Reuse,

Rebuild, and Remanufacture” with the aim of supporting

Recovery
Logistics

Reprocessing
Logistics

recycling logistics and ultimately becoming an intermediate
processing business for recovered auto parts, etc., to promote the realization of circulation businesses.

RecycleReuse

Dismantlingcompanies, etc.

Batteries
Tires (rubber)● Bumpers(Polypropylene)● Carbon ﬁber, etc.
● Transmissions● Engines● Starters● Airbags, etc.
●●

NIKKON Group /Business Operators

Switching from Mercury andFluorescent Lights to LEDs
The NIKKON Holdings Group is actively promoting the replacementof fluorescent and mercury lights in our warehouses and oﬃces with

LED lighting, which emits less CO2. Our core operating company NIPPONKONPO UNYU SOKO CO., LTD. has been using LEDs for lighting in all

warehouses completed since 2013, and will replace 94% of its mercury

and ﬂuorescent lights with LEDs by the end of FY2023. All 74 Group companies are working toward the goal of eliminating mercury lights acrossthe Group according to our 13th Medium-Term Business Plan.

Integrated Report 2023

23

Data

especially at our core operating company NIPPON KONPO UNYU SOKO CO., LTD. Our drivers are mindful of gradual acceleration, gradual braking,of Circular Business

Foundations for Growthcurrent heavy-duty vehicles. In addition, one driver is able to move twice as much freight, which“next-generation, environmentally friendly” full-trailer trucks, which signiﬁcantly improve

Integrated Report 2023

Reprocessing Logistics
In order to fulﬁll our responsibility as a company involved

saves labor and improves eﬃciency. We will continue to expand the use of these22

extensive network that can serve a wide variety of cus-

Our 21-meter double-trailer trucks (21-meter full-trailer trucks) are environmentally friendly
trucks that have double the load capacity of heavy-duty trucks and emit 37% less CO2 thaneco-tires and fuel-economy oil.

we also focus on collecting used parts and products fromtomers to expand business volume.

Modal Shift: Introduction of Environmentally Friendly 21-meter Full-Trailer Trucks (Domestic Shipping)

NIKKON Holdings Group’s Overall Vision– Realize circulation businesses –semi-cylindrical container for passenger cars designed to match the shape of tunnels while maximiz-ing loading eﬃciency. Since early on, we have been working to reduce our environmental impact (CO2NIKKON’s Growth Strategy

The NIKKON HoldingsGroup believes that it
has a social responsibility
to protect and maintainthe global environment
through sound businessactivities. We continuously
engage in activities toimprove the environment
in order to realize a society
which coexists in harmony
with the environment.

Policy on the Environment

SECTION 3 Foundations for GrowthMaterial Issues

Strengthening Compliance

At NIKKON Holdings, the Compliance Promotion Committee takes the lead indeﬁning the laws, regulations, and internal rules that each and every employee

NIKKON at a Glance

Compliance Educationand director of the Group must comply with when performing corporate

Compliance Philosophy

activities. Speciﬁc examples of our compliance education activities include

Compliance Policies

preparing and distributing compliance handbooks and displaying posters to

The NIKKON Holdings Group engages

1. Develop a compliance structure and promote compliance by positioning compliance as the top management

compliance system with a strong sense

2. Fulﬁll our duties as a member of society by instilling compliance in our workforce and practicing compliance withinincrease our value to society.

3. Engage in corporate activities by respecting the human rights of individuals and without infringing on human rights

in business activities by maintaining aof ethics to respect human rights andraise awareness of compliance issues, as well as devoting a large amount oftime to compliance training as the most important topic in our training forpriority, and strive to maintain and improve the eﬀectiveness of the structure used by our corporate group.

new employees, newly appointed managers, and newly appointed directors. In

addition, we provide individualized training on speciﬁc themes, such as training

the operating companies, and carry out business activities aiming to be trusted by all stakeholders.

to prevent insider trading. These are a part of the system we have establishedto ensure that our employees live up to the trust and expectations of society.

through acts such as unequal or discriminatory treatment.

4. Create a structure for transactions that enables mutual trust to be developed through every transaction and which

NIKKON’s Growth Strategy

ensures fair, unrestricted transactions.

5. Do not engage with antisocial forces which threaten the safety of civil society, such as organized crime groups, anddo not have any relationships with them.

The Compliance Promotion Committee

Harassment
In order to prevent harassment in the workplace, we have introduced a training program that[Compliance Organization Chart]

makes use of e-learning and other methods with the aim of early detection and correction of

To implement the NIKKON Holdings Group Code of Conduct andPresident

and policies, the Compliance Promotion Committee plays a central

Board of Directors

other standards of conduct, including compliance-related guidelinesrole in developing our internal compliance structure and providing

the Group with education to ensure that all employees are aware of

Audit & Supervisory
Committee

and comply with laws, regulations, and the Group’s internal rules.

Provide guidance/ improvements

times a year and functions as an advisory body to the Board of

Chairperson
Vice Chairperson
Members

The Compliance Promotion Committee

Report

The committee reports on its activities to the Board of Directors four

The Compliance
Promotion Committee

Legal Aﬀairs Department

Provide guidance/ improvements

Directors. Not only does the committee assign compliance oﬃcers
it also distributes compliance handbooks to all employees toCompliance Leaders(Oﬃce managers, section managers)

Each sales or management department
head: Compliance Oﬃcer
Compliance Leaders

Business department / sales oﬃce members

Department members

Business departments / Sales oﬃces

Head oﬃce sales and administration departments

Compliance Oﬃcer

and raise their level of awareness.

hotline cases to the Board of Directors. In addition, we conduct an annual
harassment prevention training program for all employees, including

part-time workers, to ensure that each and every employee has a thorougheliminate harassment. Some of our subsidiaries have launched initiatives
in which harassment counselors serve as a consultation resource for
employees and help to resolve issues.

[ Subsidiaries and aﬃliates ]Information Security
We regard information leaks and cybersecurity as important risks, and haveestablished an information security policy and conduct annual training for
employees to raise the level of awareness of each and every employee. In[Risk Management Structure]
Auditing/
Oversight

Board of Directors
Board of Directors

Directors (Audit & Supervisory Committee members)<Audit & Supervisory Committee>
ReportReport risks
during normal
times

NIKKON Holdings
ReportPresident, Representative Director
emergency
and
Chief
Executive Oﬃcersituations

NIKKON Holdings
The Risk Management Committee
Chairperson: Risk Manager

Reportemergency
situations

Report risks
during normal
times

Subsidiary and aﬃliate management department
Risk Management Oﬃcer(Director in charge of general aﬀairs)

24

Integrated Report 2023

Special audit
instructions

NIKKON HoldingsGroup Operational Audit
Oﬃce

NIKKON Holdings
Executive Oﬃcer in chargeof General Aﬀairs

Report emergency
situations

Audit

NIKKON Holdings Risk Management Oﬃcers(heads of each department and oﬃce)
Group Administration
Department
Accounting Department
Legal Aﬀairs Department

Domestic Business
Department

Overseas Business
Department
Real Estate Business
Department
Management Planning
Department

NIKKON Holdings positions risk management as a top

through measures such as installing the latest anti-virus software and reducing

Sales Planning Oﬃce
M&A Promotion Oﬃce
Group Operational Audit Oﬃce

to prevent insider trading, protect personal information, and back up systemdata in case of system failures. We also take precautions against cyber attacks
communication with external networks to the minimum extent necessary.

management priority and has established risk

management rules to ensure sound and appropriate
business operations throughout the Group. The Risk
Management Committee, chaired by a director,

analyzes and evaluates potential disaster, accident,

NIKKON Holdings
General Aﬀairs Department HeadGeneral Aﬀairs
Department

information leaks, we are especially focused on strengthening data governancemanagement, ﬁnancial, information, and social risks

Business Continuity Plan (BCP) Measuresinternal Risk Management Rules. The committee also

When replacing the AS400 system, our core operating company migrated data from the head oﬃce annex (Saitama Prefecture) and its backup

for each Group company in accordance with ourtakes necessary countermeasures in line withmanagement strategies, reports the status of risks to
the Board of Directors every three months foroversight purposes, and establishes systems toprepare for future risks.

location at a Group operating company (Mie Prefecture) to dedicated data centers in Saitama and Osaka that are available 24/7, strengthening our preparedness for large-scale disasters and prolonged power outages. We also share sales oﬃce hazard map lists and details within

our groupware. Most importantly, regarding our employees’ response, we register all employees in a safety conﬁrmation system and conductperiodic disaster drills to prepare for unforeseen circumstances. We provide managers with training on the safety conﬁrmation system via

e-learning, covering the necessity of safety conﬁrmation, the basic process, system overview, and operation methods. This helps managers

conﬁrm the safety of employees, quickly restore business operations, raise disaster awareness, and utilize the system from the perspective of
business continuity planning.

Integrated Report 2023

25

Data

Oversight Training

Oﬃce(Group Administration
Department)

Reportaddition to preventing unauthorized access to information assets and

The Risk Management
Committee

Foundations for Growthfamiliarize them with our compliance policies (Code of Conduct)(hotline), and we regularly report the number and content of theseunderstanding of harassment. Thus, the entire Group works together toReport[ Core operating company ]Each business department head:and compliance leaders to all NIKKON Holdings Group companies,

illegal or inappropriate behaviors. We also have an internal reporting system

SECTION 3 Foundations for Growth

NIKKON at a Glance

Corporate
GovernanceMateriality

Basic Approach to Corporate GovernanceEvaluating the Eﬀectiveness of the Board of Directors

As a holding company that oversees the business of the Group, we believe that it is important to be constantly aware of theEach ﬁscal year, we conduct an evaluation of the eﬀectiveness of the Board of Directors as a whole, aiming to conﬁrm how

through the eﬃcient utilization of management resources and appropriate risk management, and to build relationships of

ed a self-evaluation in the form of a questionnaire with 29 questions on a ﬁve-point scale and a free response section. In

the Board currently functions and improve its eﬀectiveness. For the ﬁscal year ended March 31, 2023, the directors conduct-

soundness, lawfulness and speed of management, to maintain growth and enhance corporate value in the long term

addition, to ensure the objectivity of the evaluation process, a third-party organization was used to analyze the results oftrust with all stakeholders including shareholders, based on our Management Philosophy.

their responses.

Accordingly, to develop the environment for a framework governing corporate activities (corporate governance) and toensure that this framework functions eﬀectively, we are developing and strengthening our organizational structure andstriving to ensure the transparency of corporate activities.

Evaluation Results

As for our internal control system, we have established a Code of Conduct and have developed a compliance system andrisk management system as measures to protect the soundness of our business. By engaging in such business activities,
to the development of society.

Corporate Governance Structure Chart
General Meeting of Shareholders
Election/Dismissal

Election/Dismissal

Election/Dismissal

Board of Directors
Directors(Audit & Supervisory
Committee Members)

Election/Direction/Oversight

Auditing/OversightElection/Oversight

Representative Director
Executive Directors
Executive Oﬃcer Meeting

Management/Control

Consultation

Collaboration

Reporting/Referral

Nomination Committee
Remuneration Committee

Collaboration

Sustainability Committee
Auditing

Group Operational Audit Oﬃce

Collaboration

Pre-distribution and brieﬁngs ofmaterials
Information-sharing between
outside and inside directors
Oﬃcer training

The Board of Directors is composed of 10 Directors (including

four Independent Outside Directors). We hold monthly ordinary

Board of Directors’ meetings to approve material matters, monthly
Management Strategy Council meetings to speed up material
decision-making, and monthly Executive Oﬃcer meetings mainly forthe purpose of reporting and exchanging information. This structure

enables us to strengthen the oversight function, expand the scope ofmatters deliberated on and reported, and make ﬂexible decisions.

Committees
We have established a Compliance Promotion Committee, Risk
Management Committee, and Sustainability Committee to deal
with material management issues, thereby building a structure

Audit & Supervisory Committee and Its Members
The Audit & Supervisory Committee is composed of three Audit &26

Integrated Report 2023

structure in accordance with the Audit & Supervisory Committee Rules,
the Audit & Supervisory Committee Audit Standards, and the Audit &Supervisory Committee Auditing Standards for Internal Control System.
We have also adopted a structure which allows Audit & Supervisory
Committee Members to adequately monitor Directors’ performanceof duties through attendance at Board of Directors’ meetings andother important meetings; individual interviews with Directors, division
managers, and other relevant persons; and business audits andreports on business locations in Japan and overseas.

Voluntary Nomination Committee and Remuneration Committee
We have established a voluntary Nomination Committee andRemuneration Committee, the majority of which comprises Independent
Outside Directors, to serve as advisory bodies to the Board of Directors.
These committees enhance the objectivity and transparency of thedecision-making processes concerning the personnel matters of senior
management, who play a role in the company’s sustainable growth andin building trust, and directors’ remuneration, further enhancing andstrengthening the management and governance structure.

●

Discuss at Board of Directors’ meetings the appropriateness of the current distribution of materials and thetiming and content of advance brieﬁngs, etc.
(Give consideration to the circumstances of the resources handling the distribution and brieﬁngs.)
Provide ongoing training opportunities for internal oﬃcers to improve their knowledge and reform theirawareness of a wide range of corporate management and governance issues, and for outside oﬃcers to
supplement their industry-speciﬁc knowledge.

Hold discussions on company-wide management strategies based on the internal and external environment to ensure the appropriate allocation of digital management resources (e.g., incorporate management
strategy themes into agenda plans, secure time for deliberation, etc.).
● On the executive side, consider allocating digital management resources based on management strategies
and promote systematic initiatives.
● Consider appropriate KPIs that contribute to the monitoring of progress on the executive side.

Allocation of digital management
resources

Share perspectives on sustainability-related issues and their importance between oversight (directors) and
execution (executive oﬃcers).
(Example initiative: Enhance explanations from the executive side on issues and policies for addressing them, etc.)● Hold discussions on ESG topics that stakeholders are interested in.
(Example initiative: Conﬁrm and provide advice on the appropriateness of the Board of Directors from astakeholder perspective, etc.)● Monitor achievements and progress in light of how they align with the management philosophy, long-term vision, etc.
●

Enhancement of corporate value byaddressing sustainability issues

Discuss among Nomination Committee members how discussions regarding succession planning shouldtake place in the committee and the process for objective and transparent deliberation.
● Regularly communicate information to the Board of Directors regarding the status of deliberations in the
Nomination Committee and reach a shared awareness among members of the Board of Directors on thevision for the committee (ideal scope and depth).
●

Senior management succession
planning

Monitoring of strategies withrespect to management
indicators

Regularly monitor the status of business execution using appropriate management indicators as a basis fordiscussions on the cost of capital.
● Reach a shared understanding of the management indicators necessary for monitoring business execution.
● Incorporate business execution reports that utilize the indicators into agenda plans and report regularly to
the Board of Directors.
●

Consider necessary human investments and appropriate monitoring indicators by backcasting from themedium-term strategic goals.
● Link initiatives to the Medium-Term Business Plan, visualize the overall picture, further invigorate discussions at Board of Directors’ meetings, and strengthen monitoring.
● Compare and contrast the current situation with the three perspectives and ﬁve common elements raised in the“Ito Report 2.0 for Human Capital Management” and appropriately oversee the PDCA cycle to narrow the gap.
● Conduct discussions with Outside Directors in relation to business portfolio management.
●

Human resource development
and improving the internal
environment

Integrated Report 2023

27

Data

for increasing expertise and ﬂexibility. As a rule, each committee
convenes regularly once a quarter, and additionally as necessary.
Committees report and make proposals to the Board of Directors andalso provide guidance to each division.

Supervisory Board Members (including two Independent Outside
Directors). We hold Audit & Supervisory Committee meetings andmeetings of Audit & Supervisory Committee Members and seek tostrengthen their independence and functions by adopting an audit●●

Auditing

Directors and Board of Directors

Directions for improvement

Foundations for GrowthManagement/Control

Each Business Department/Aﬃliate<Audit & Supervisory
Committee>

Accounting Auditor

Directors(Excluding Audit & Supervisory Committee Members)

Issues identiﬁed in the evaluation results

appropriately involved in the evaluation and remuneration of senior
management. On the other hand, the results revealed that in order tofurther improve the Board’s eﬀectiveness, further work was needed
concerning the provision of information to the Board of Directors, theenhancement of deliberations on medium- to long-term strategies(allocation of digital management resources, human resource development, and sustainability), and discussions on succession planning.

NIKKON’s Growth Strategy

Based on a comprehensive analysis and assessment of the results ofthe evaluation of the eﬀectiveness of the Board of Directors for theﬁscal year ended March 31, 2023, we were able to conﬁrm that, overall, the Board of Directors is generally eﬀective. The results showedthat the Independent Outside Directors function eﬀectively, thatinternal control and risk management systems have been appropriately established, and that the Independent Outside Directors are

we intend to fulﬁll our corporate responsibilities to all stakeholders, including customers and shareholders, and contribute

SECTION 3 Foundations for Growth

Corporate Governance
NIKKON at a Glance

Directors and Oﬃcers

Director Skill Matrix
In light of our medium- to long-term management direction and business strategy, we identiﬁed the skills that our Board of
Directors should possess in order to properly fulﬁll its decision-making and management oversight responsibilities.

The following skill matrix shows the composition of the Board of Directors and the skills each director and Audit &Supervisory Committee member possesses. Directors are appointed in consideration of diversity, including gender andinternational experience, with the aim of making objective judgments on management issues from diverse and indepen-

dent perspectives. In addition, as a packaging, transportation, and warehousing business, we consider traﬃc safety and theimprovement of the working environment to be among our top priority issues. For this reason, we have added knowledge
and expertise in safety management to the skills directors should possess. For Audit & Supervisory Committee members,
the committee has established separate requirements for candidates and appoints members accordingly.

Our approach to each skill and expertise area is as follows. Please note that these are the skills and areas of expertise

Representative Director
Senior Executive Oﬃcer

Director
Managing Executive Oﬃcer

Director
Executive Oﬃcer

Director
Executive Oﬃcer

Masakatsu Kuroiwa

Seiji Ooka

Yasunori Matsuda

Hidehiro Motohashi

Kioi Yamada

that we speciﬁcally expect from each director, and the following matrix does not necessarily represent all of the skills andexpertise areas each director possesses.

Director

Director

Director (Audit & Supervisory
Committee member)

Director (Full-time Audit & Supervisory Committee member)

Director (Audit & Supervisory
Committee member)

Aiko Koma

Ryutaro Ozeki

Hideki Miyata

Hiroshi Sakairi

Tetsuya Okuda

President, Representative Director
and Chief Executive Oﬃcer

Masakatsu Kuroiwa

Director

Ryutaro Ozeki

Executive Oﬃcer

Takashi Abe

Executive Oﬃcer Takashi Shibayama

Representative Director
and Senior Executive Oﬃcer

Seiji Ooka

Director(Audit & Supervisory Committee member)

Hideki Miyata

Executive Oﬃcer

Masahiko Masui

Executive Oﬃcer Toshihisa Nishimura

Director andManaging Executive Oﬃcer

Yasunori Matsuda

Director (Full-time Audit & Supervisory
Committee member)

Hiroshi Sakairi

Executive Oﬃcer

Yasuyuki Mizumachi Executive Oﬃcer Sakyo Horii

Director andExecutive Oﬃcer

Hidehiro MOtohashi

Director(Audit & Supervisory Committee member)

Tetsuya Okuda

Executive Oﬃcer

Takayuki Matsushima Executive Oﬃcer Sumito Hashimoto

Director andExecutive Oﬃcer

Kioi Yamada

Executive Oﬃcer

Katsuya Unno

Director

Aiko Koma

Executive Oﬃcer

Atsushi Kayamoto

4 out of 10

directors must be suﬃcient to enable the Board of Directors to function

40%

peopleDirector may serve on the Board to eight years or less.

28

Integrated Report 2023

Nomination Committee member
Remuneration Committee member

2

Seiji
Ooka

President andRepresentative Director
Chief Executive Oﬃcer
Representative Director
Senior Executive Oﬃcer

3

Yasunori
Matsuda4

Hidehiro
Motohashi

5

1 out of 10
peoplePercentage of independent
outside directors

Percentage of women

Personal Aﬀairs
InternaHuman Resources
tionality
Development

Safety

●

●

●

●

●

●

●

Male

Risk Management Committee
Chairperson

●

●

●

●

●

●

●

Male

Director
Managing ExecutiveOﬃcer

Compliance Promotion Committee
Chairperson
Sustainability Committee member

●

●

●

●

Male

Director
Executive Oﬃcer

Risk Management Committee Vice
Chairperson

●

●

Male

Kioi
YamadaDirector
Executive Oﬃcer

Risk Management Committee
member

●

6

Aiko
Koma

Outside Director●

7

RyutaroOzeki

Remuneration Committee
Chairperson
Sustainability Committee Chairperson

Outside Director

Nomination Committee
Chairperson●

Audit & Supervisory Committee
Chairperson
Remuneration Committee member●

8

Hideki
Miyata9

Hiroshi
Sakairi

10

TetsuyaOkuda

Outside Director
Audit & Supervisory
Committee member
Director
Full-time Audit & Supervisory
Committee member
Selected Audit & Supervisory
Committee member
Outside Director
Audit & Supervisory
Committee member

●

●

●

●
●

Male
Female

●

Male

●

Male

●

●
Nomination Committee member

●

●

IT
DigitalGenderFinance
Accounting

●

●

●

●

●

Male

●

●

Male

Comment from an Outside Director

Outside Directors serve various roles. In order to meet the challengeof continuously increasing corporate value for our shareholders,
however, I feel that it is important for the Board of Directors not only
to provide their opinions from the perspective of ﬁnancial corporate
growth, but also from the perspective of our contribution to society
and how we can enhance the value of our human capital. In addition,in order to invigorate the Board of Directors, we have entrusted athird-party organization with evaluating the eﬀectiveness of the Boardof Directors. We will continue to take steps to improve the issues they
have identiﬁed with the aim of deepening corporate governance.
We oversee management through the Nomination and Remuneration committees, which are advisory bodies to the Board of
Directors. In addition, through the Sustainability Committee, which
I chair, we monitor the execution of ESG-related matters and makerecommendations on how the company can reduce CO2 emissions

and create a platform for women’s empowerment, which is the ﬁrst
step in promoting diversity, equity, and inclusion (DE&I).
In order for human capital management, which is essential forenhancing long-term corporate value, to take root, it is important toraise the level of awareness within the company. The entire Group
must share the belief that the happiness of each employee truly
makes the company grow. I hope the NIKKON Group will continue toinstill this belief and address social issues, so that it can continue tobe a company capable of contributing to society.

Integrated Report 2023

29

Data

must be Independent Outside Directors. Four out of 10 of our directors
tor). In principle, we limit the total number of years that an Outside

Masakatsu
Kuroiwa

Insight, Expertise, Experience
Legal
AﬀairsAiko Koma

10%

objective oversight, a signiﬁcant percentage of the Board of Directors(40%) are Independent Outside Directors (including one female direc-

1

Independent Corporate
Out- ManagesidementOutside Director / Sustainability Committee Chairperson

necessary insight and high standards of ethics, fairness, and integrity,eﬀectively and eﬃciently. In addition, to ensure highly transparent andCommittees

We will improve the quality of governanceand provide insight on human resource
development and environmental measures.

Composition of the Board of Directors
and who possess diverse expertise and experience. The number of

Position

Executive Oﬃcer Satoshi Mizukami(Notes) 1. Directors Aiko Koma, Ryutaro Ozeki, Hideki Miyata, and Tetsuya Okuda are Outside Directors as deﬁned in Article 2, item (xv) of Japan’s Companies Act.
2. Directors Aiko Koma, Ryutaro Ozeki, Hideki Miyata, and Tetsuya Okuda are independent directors as prescribed by the rules of the Tokyo Stock Exchange (TSE),
and notiﬁcations of their appointment as such have been submitted to TSE.

The Board of Directors must be composed of directors who possess the

Name

Foundations for Growth(as of June 29, 2023)

Officers

No

NIKKON’s Growth Strategy

President andRepresentative Director
Chief Executive Oﬃcer

SECTION 4 Data

NIKKON at a Glance

Financial and Non-ﬁnancial Highlights
Fiscal year ended March 31, 2014 – Fiscal year ended March 31, 2023

FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022Financial data
170,076

174,031

179,312

187,819

197,693

199,512

182,536

198,159

212,071

Operating proﬁt (million yen)

14,87815,20017,511

18,13019,00920,02820,89018,191

19,512

19,580Proﬁt before income taxes (million yen)

18,762

18,484

18,24720,027

21,25921,73024,401

21,397

21,637

22,776

Proﬁt attributable to owners of parent (million yen)

11,57812,312

11,875

13,468

14,545

14,76816,721

14,544

14,741

15,913

Total assets (million yen)

234,476

243,457

254,298

280,079

286,559

294,213

297,489

322,139

339,475

360,748

Equity (million yen)

146,480

155,842

159,179

170,910

182,101

186,338

192,780

207,747

218,478

228,873

Depreciation expense (million yen)

5,333

7,044

8,216

9,351

9,461

9,712

10,413

10,630

11,237

12,307

Total capital investment (million yen)

16,001

18,98433,087

23,216

15,21325,914

16,54828,34428,28022,226

Cash ﬂows from operating activities (million yen)

15,187

17,994

19,111

22,75724,30925,33725,901

23,22928,98532,547

Cash ﬂows from investing activities (million yen)

-22,051-5,430-28,334-20,984-22,884-16,892-19,867-25,402-31,567-22,548

Cash ﬂows from ﬁnancing activities (million yen)

11,906-3,296

1,621

6,987

-8,330-11,659

-584

1,473

759

-208

Equity ratio (%)

62.5

64.0

62.6

61.0

63.5

63.3

64.8

64.5

64.4

63.4

Operating proﬁt ratio (%)

9.0

8.9

10.1

10.1

10.1

10.1

10.5

10.0

9.8

9.2

ROA (%)

5.4

5.2

4.8

5.0

5.1

5.1

5.7

4.7

4.5

4.5

ROE (%)

8.2

8.1

7.5

8.2

8.2

8.0

8.8

7.3

6.9

7.1

Annual dividend per share (yen)

50

54

53

60

65

67

76

67

69

99

Earnings per share (EPS) (yen)166.20179.67

175.73199.22215.30221.03254.01221.26224.41

246.61

Book value per share (BPS) (yen)

2,100

2,306

2,355

2,529

2,702

2,810

2,932

3,160

3,334

3,566

Dividend payout ratio (%)

30.1

30.1

30.2

30.1

30.2

30.3

29.9

30.3

30.7

40.1

-

-

18,373

19,965

20,163

20,333

20,46520,205

20,582

20,243

Japan

-

-

9,143

9,322

9,425

9,645

9,605

9,493

9,498

9,511

Overseas

-

-

5,355

6,299

6,033

5,781

5,944

5,865

6,085

5,760

Female Japan

-

-

1,593

1,714

1,805

1,936

2,017

2,057

2,132

2,187

Overseas

-

-

2,282

2,630

2,900

2,971

2,899

2,790

2,867

2,785

Japan

-

-

3,575

3,630

3,658

3,661

3,695

3,750

3,858

3,789

Overseas

-

-

758

703

688

782

757

756

773

760

Japan

-

-

1,524,592.12

1,661,321.89

1,654,463.78

1,775,386.65

1,810,474.18

1,877,006.74

1,940,010.60

2,012,078.22

Overseas--320,924.00

373,859.00

395,482.65

432,690.25

469,169.90

474,877.34

492,840.74

492,840.74

-

-

-

-

-

-

-

-

21,861

23,331

-

-

-

-

-

-

-

-

10,616

11,790Foundations for Growth

165,205

NIKKON’s Growth Strategy

Net sales (million yen)

Non-ﬁnancial data
Number of employees
Male

Number of vehicles

Warehouse area (m2)Reduction in CO2 emissions (t-CO2) due

Reduction in CO2 emissions (t-CO2) due
to modal shift (use of ships)

30

Integrated Report 2023

Integrated Report 2023

Data

to modal shift (use of rail)

31

SECTION 4 Data

Company Proﬁle and Stock Information

Japan and Overseas Business Locations

Company Proﬁle (as of March 31, 2023)

Japan

45

Number of domestic sales oﬃces

Tomakomai (NK)
Ebetsu (NK)Takasu Center (NK)NIPPON KONPO UNYU SOKO CO., LTD. (“NK”) (core subsidiary) with 89 sales oﬃces
44 other subsidiaries and aﬃliates with 199 sales oﬃces

Sapporo Shinbun Yuso Co., Ltd.
Hokkai Butsuryu Service Co., Ltd.

Tohoku area

Kanazawa (NK)Toyama (NK)Toyama Kosugi (NK)
KANAZAWA NIKKON CO., LTD.

Niigata (NK)Matsumoto (NK)7 other sales oﬃces (NK)NIIGATA NIKKON CO., LTD.
MATSUMOTO NIKKON CO., LTD.

Hanamaki (NK)
Kakuda (NK)Kitakami (NK)Sendai (NK)Osaki (NK)Iwaki (NK)
Koriyama (NK)
Iwanuma (NK)NIKKON TOHOKU CO., LTD.
SENDAI NIKKON CO., LTD.

Kanto area
NIKKON Holdings Co., Ltd. Head Oﬃce
NIPPON KONPO UNYU SOKO CO., LTD. Head Oﬃce
Utsunomiya (NK)Koga (NK)
Ibaraki (NK)Ota (NK)
Tokyo (NK)
Sayama (NK)Kinki area
Hirakata (NK)Kobe (NK)Nagahama (NK)Shin Ibaraki (NK)Nara (NK)4 other sales oﬃces (NK)NIKKON NARA CO., LTD.

929

countries

Stock Information (as of March 31, 2023)
Shares Status

Total number of authorized shares 152,000,000
Total number of issued shares

65,739,892

100

Fujisawa (NK)Ogawa (NK)
Odawara (NK)
22 other sales oﬃces (NK)NIPPON UNYU CO., LTD.
CHUETSUTEC Co., Ltd.
Auto Technic Japan Co., Ltd.
Ryoji Unyu Co., Ltd.
17 other subsidiaries
and aﬃliates

Distribution of Shareholders
Financial
institutions
32 (0.75%)

Financial instruments
business operators
23 (0.54%)

Foreigncorporations, etc.
180 (4.23%)

Number ofshareholders
by typeOther
corporations
122 (2.86%)

Individuals /Others3,902 (91.62%)

Tokai area
Shin Miyoshi (NK)Nagoya (NK)
Gifu (NK)
Hamamatsu (NK)Suzuka Center (NK)7 other sales oﬃces (NK)

MEIKON CO., LTD.
NIPPON RIKUSO Co., Ltd.
TECHNIC SERVICE Co., LTD.
Technical Nippon Co., Ltd.
ITO-EXPRESS CO., LTD.
5 other subsidiaries and aﬃliates

NIKKON LOGISTICS CHINA CO., LTD.
FUTIAN NIKKON LOGISTICS (GUANGZHOU) CO., LTD.
GUANGZHOU DONGFENG NIKKON LOGISTICS CO., LTD.
NIKKON CHONGQING LOGISTICS CO., LTD.

companies
NK PARTS INDUSTRIES，INC.
NK AMERICA, INC.
4 other subsidiaries and aﬃliates

NIPPON KONPO VIETNAM CO., LTD.
NKV LOGISTICS LTD.
2 other subsidiaries and aﬃliates

NKP MEXICO, S.A. de C.V.
NK LOGISTICA MEXICO, S.A. de C.V.

4,259

Financial instruments
business operators
908,000 shares(1.38%)
Financial
institutions
17,192,000 shares(26.15%)

Individuals /Others12,041,000 shares(18.32%)

Number of sharesby shareholder type

Foreigncorporations
24,047,000 shares(36.58%)Major Shareholders
No. ofShareholding
shares held
ratio (%)
(thousand)Shareholder

8,506

13.25

NORTHERN TRUST CO. (AVFC) RE SILCHESTERINTERNATIONAL INVESTORSINTERNATIONAL VALUE EQUITY TRUST

5,887

9.17

Custody Bank of Japan, Ltd. (trust account)

2,872

4.47

General Incorporated Association Kuroiwa-kai

2,560

3.98

NORTHERN TRUST CO. (AVFC) RE U.S. TAX EXEMPTEDPENSION FUNDS

2,557

3.98

Honda Motor Co., Ltd.

2,449

3.81

NORTHERN TRUST CO. (AVFC) RE NON TREATY CLIENTSACCOUNT

2,078

3.23

Isuzu Motors Limited

1,692

2.63

NORTHERN TRUST CO. (AVFC) RE IEDU UCITS CLIENTS NONLENDING 15 PCT TREATY ACCOUNT

1,504

2.34

Hino Motors, Ltd.

1,494

2.32

The Master Trust Bank of Japan, Ltd. (trust account)(Notes) 1. NIKKON Holdings Co., Ltd. holds 1,536,691 treasury shares. However, it is excluded
from the major shareholders.
2. The treasury shares are excluded from the calculation of shareholding ratios.
3. NIKKON Holdings Co., Ltd. implements a stock remuneration program. The treasury shares do not include 26,900 shares of NIKKON Holdings held by the Custody
Bank of Japan, Ltd. (trust account) as assets in trust for this program.

Other
corporations
11,548,000 shares(17.57%)(Note) The treasury shares are included in the category “Individuals andothers.”Share Prices Chart
(Yen)
3,300

Closing price (left axis)

Average share price by ﬁscal year (Apr. 1–Mar. 31; left axis)

Foundations for Growth

Kyushu area
Kikuyo (NK)Fukuoka (NK)Moji (NK)4 other sales oﬃces (NK)Nikkon Kyushu Co., Ltd.
CHUETSU YUSOU Co., Ltd.
NIKKON KITAKYU CO., LTD.

Overseas

Number of Group 74 (70 subsidiaries and 4 aﬃliates)
companies

Number of shareholders

Okayama (NK)
Osafune (NK)
Hiroshima (NK)CHUGOKU BUTSURYU SERVICE CO., LTD.

Matsuyama (NK)Kochi (NK)Sakaide (NK)NIKKON MATSUYAMA CO., LTD.

https://www.nikkon-hd.co.jp

Trading unit

Chugoku area

Shikoku area

11,316 million yen

August 27, 1953

NIKKON’s Growth Strategy

Koshinetsu area

Capital stock
WebsiteHokkaido area

NIKKON Holdings

Hokuriku area

NIKKON Holdings Co., Ltd.

Established

288

Breakdown

companies

Company name

NIKKON at a GlanceGroup Companies

Average trading volume by ﬁscal year (Apr. 1–Mar. 31; right axis)(Shares)
240,000

2,640

192,000

1,980

144,000

1,320

96,000660

48,000NIPPON KONPO PHILIPPINES, INC.
NIPPON KONPO INDIA PVT. LTD.
KOLAR LOGISTICS AGENT PVT. LTD.
TAPUKARA LOGISTICS AGENT PVT. LTD.

NIPPON KONPO (MALAYSIA) SDN. BHD.
NKM LOGISTICS SDN. BHD.

32

Integrated Report 2023

PT. NIPPON KONPO INDONESIA
PT. NK INDO LOGISTIK
PT. NKI GUDANG KEMAS(as of March 2023)
NIKKON NARA CO., LTD. changed its company name to NIKKON Logistics Co., Ltd., eﬀective April 1, 2024.
Hokkai Butsuryu Service Co., Ltd. changed its company name to Nikkon Hokubutsu Co., Ltd., eﬀective April 1, 2024.

Data

A.N.I. LOGISTICS, LTD.
NIPPON KONPO (THAILAND) CO., LTD.
2 other subsidiaries and aﬃliates00
2012/04

2013/04

2014/04

2015/04

2016/04

2017/04

2018/04

2019/04

2020/04

2021/04

2022/04

2023/04

Integrated Report 2023

33